Below we look at the joint merger announcement released by Santos at lunchtime today.
Santos and Oil Search merger now effective
Today, Santos advised that its merger with Oil Search is officially effective. This follows earlier approval from Oil Search shareholders, and a green light from the National Court of Papua New Guinea yesterday.
Oil Search shareholders will receive 0.6275 new Santos shares for each Oil Search share they hold on the record date of 14 December.
The market cap of the newly merged ASX 200 energy company is estimated at $22 billion.
Today marks the last day of trading on the ASX and PNGX for Oil Search shares.
New Santos shares will start trading on the ASX and PNGX on a deferred settlement basis next Monday 13 December. They will begin trading on a normal settlement basis on 20 December.
What did management say?
Commenting on the merger becoming effective, the Santos chairman Keith Spence said:
The merger combines two industry leaders to create a regional champion of quality, size and scale with a unique and diversified portfolio of long-life, low-cost oil and gas assets.
We look forward to integrating our businesses to create one high performing team – with a vision of becoming a global leader in the energy transition.
Santos CEO, Kevin Gallagher, added:
Santos and Oil Search are stronger together and will have increased scale and capacity to drive a disciplined, low-cost operating model and unrivalled growth opportunities over the next decade.
The merger creates a company with strong and diversified cash flows, providing a platform to deliver shareholder returns and successfully navigate the transition to a lower carbon future.
Additionally, the merger builds on our industry-leading approach to ESG through the combination of Santos’ leading carbon capture and storage capabilities with Oil Search’s social programs in PNG and North America.
How’s the Santos share price tracking today?
Santos and Oil Search shares have fallen during intraday trading on Friday.
At the time of writing, the Santos share price is $6.46, down 2.49%. The Oil Search share price is $4.03, down 2.66%.